This American election campaign is an odd one for facts.
Many supporters of a Trump presidency like the idea that Trump “tells it like it is” and that Trump does not use polite code words to hide reality.
Others have noted that we have entered a “post-truth political era” in which fact checkers state that a politician’s lie is so bad that it is labelled as “pants on fire” or “four Pinnochios”. Some people try to assert that feelings and perceptions are kinds of fact.
It is hard to find a memorable lesson from this teachable moment, since some of them repeat what should be obvious. Some commentators have noted some more subtle lessons. Continue reading
It is fashionable to say that economic ideas are wrong, at best, and, at worst, dangerously misleading. This fashion is not new. Since the most familiar pieces of the traditional economics model have survived for many decades, it is worth seeing how they appear in the world of real estate. Continue reading
Real estate projects are big, complicated and involve many actors. Therefore, success often depends on a legally binding contract to ensure that things get done with as few disputes as possible.
The first barrier to finding an answer is to describe the situation accurately: e.g.
- What is the source of uncertainty? If there is none then it is too easy to detect misbehaviour.
- are there only two outcomes (“success” and “failure”) or a continuum between really good to really bad?
A clear theory helps immensely.
The second puzzle is that changing the incentive changes the anticipated behaviour, which changes the outcome and the degree of risk. Think how the behaviour of a real estate agent might change if Continue reading
Real estate is a very old business, and has a bit of a reputation for not being very innovative (compared to, say, computer tech or bio tech). That comparison is a bit unfair, since the real estate business would be truly scary if the success rate for innovation is as low as it is in tech. And, the long life span of buildings makes the attitude of “fail fast and move on to Plan B” (common in tech) very expensive.
What should be praised is the attempt to innovate. For example: Net Zero (which supersedes Energy Star) or learning how to exploit information technologies. You do not need to challenge common sense all of the time, and not all attempts will discover something dramatic or useful. Curiosity generates at least the possibility of new opportunities. Continue reading